Australia's peak body for renewable energy said the Solar Flagships announcement this afternoon by the Federal Government was an important restatement of its commitment to the development of large scale solar.

"Solar Flagships is a critical first step in demonstrating the potential of large scale solar in Australia, and breaking through the range of challenges that face any new renewable energy technology," said Clean Energy Council acting Chief Executive Kane Thornton.

"This experience will ensure a pipeline of large scale solar projects can be developed faster and at lower cost.

"Solar Flagships is raising awareness about the many challenges associated with this emerging area and helping project developers learn how to design, finance and construct this exciting future source of power. We need to do the hard yards now if we want to take advantage of Australia's massive potential for large scale solar.

"The combination of Solar Flagships, the 20 per cent Renewable Energy Target, a carbon price and the Clean Energy Finance Corporation will deliver the necessary support for large scale solar and other large-scale renewable energy projects.

"The round 1 projects had to navigate some very tough financial conditions to try and secure project financing. There is no easy solution to this and we believe the government has taken a sensible approach in the circumstances," he said.

The two projects selected in the first round of Solar Flagships, Solar Dawn in Queensland and the Moree Solar Farm in NSW, missed the December 2011 deadline to meet their funding obligations.

Federal Energy Minister Martin Ferguson has announced that the deadline for Solar Dawn has been extended, and that the Moree Solar Farm consortium will need to re-submit an application. This will then be considered along with the shortlisted solar photovoltaic (PV) projects from AGL, TRUenergy and Infigen-Suntech.

Mr Thornton said the Australian Financial Review incorrectly reported that the Clean Energy Council was calling on the Federal Government to consider forcing energy retailers to sign power purchase agreements for renewable energy.

"This is not correct. While we agree there are currently challenges facing renewable energy projects in securing power purchase agreements, we believe that the swift implementation of new measures under the Clean Energy Future package along with the 20 per cent renewable energy target are the best way to achieve these outcomes," he said.